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Facts
The assessee's appeal emanates from an order by the NFAC for AY 2021-22. The Assessing Officer had made an addition under Section 69A for unexplained money. The NFAC dismissed the appeal due to the assessee's non-compliance and failure to furnish documentary evidence.
Held
The Tribunal observed that the NFAC order was ex parte due to non-compliance. While the assessee failed to provide evidence, it could not be definitively concluded that the non-compliance was deliberate or mala fide. The Tribunal decided to set aside the NFAC order and remand the matter for fresh adjudication.
Key Issues
Whether the NFAC was justified in dismissing the appeal ex parte due to the assessee's non-compliance, and whether a fresh opportunity should be granted.
Sections Cited
69A, 250
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Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI
Before: SHRI PARTHA SARATHI CHAUDHURY
Date of Hearing : 06/01/2025 Date of Pronouncement : 16/01/2025 O R D E R
This appeal preferred by the assessee emanates from the order of the NFAC dt. 23.02.24 for AY: 2021-22 u/s 250 of the Act as per the grounds of appeal on record.
In this case the AO had made addition u/s 69 A of the Act, as unexplained money and added to the income of the assessee. When the proceedings started at the level of the NFAC, even sufficient opportunities were provided to the assessee to furnish submission P a g e 1 | 5 and documentary evidences but the assessee did not comply with the hearing notices. This is evident from para’s 4.1 to 4.3 onwards in the order of NFAC. That since the assessee could not substantiate the grounds of appeal through any documentary evidences, due to non-compliance the NFAC dismissed the appeal of the assessee.
At the time of hearing none appeared for the assessee.
However, an adjournment petition was placed on record after the matter was taken as heard. The assessee had not placed on record any reasons for non-compliance before the NFAC. This bench in such circumstances has provided one final opportunity to the assessee to present case on merits before the first appellate authority. Accordingly, the adjournment petition is rejected. The submissions of the ld. DR are recorded, the documents on record have been carefully considered and matter taken as heard.
At the outset, as aforestated, it observed that the impugned 4. order is an ex parte order passed by NFAC due to non-compliance by the assessee. The assessee has not filed any documentary evidences in support of his grounds of appeal before NFAC, hence the appeal of the assessee was dismissed. Therefore, the substantive rights and liabilities of the parties herein are yet to be adjudicated by NFAC. Since the taxation laws are within the ambit of welfare P a g e 2 | 5 legislations which are completely different from penal legislations, therefore for interpretation and application of tax laws, the benefit of doubt if any, may be attributed in favour of the tax payer assessee within the legal boundaries and the relevant facts. In the instant case the NFAC had dismissed the appeal for non-compliance by the assessee. However, there is nothing on record to suggest that such non-compliance was either deliberate or ‘mala fide’. There may have been a possibility that such non-compliance was due to circumstances beyond the control of the assessee as per ‘Vis Major’. Though no evidence has been placed before this Bench for such non- compliance by the assessee at the level of NFAC, still the Revenue will not suffer any loss if a final opportunity is provided to the assessee for representing his matter on merits before the NFAC. The ld. DR fairly conceded on this count.
In view thereof I set aside the order of NFAC and remand the 5. matter back to its file for de novo adjudication as per law complying with principles of natural justice. At the same time the assessee is directed that this being final opportunity he shall furnish necessary documentary evidences and represent the case on merits before the NFAC. As per the above terms the grounds of appeal stand allowed for statistical purposes.
P a g e 3 | 5 In the result the appeal of the assessee is allowed for 6. statistical purposes.
Order pronounced in the open court on 16 /01/2025.
Sd/- (Partha Sarathi Chaudhury) JUDICIAL MEMBER Ranchi; Dated 16 /01/2025 S.S, SPS Copy of the Order forwarded to :
1. 1. The Appellant : Vikram Malhotra 2.The Respondent:, CIT(A) 3. The CIT(A)- NFAC, Delhi 4. Pr.CIT,Ranchi 5. DR, ITAT, 6. Guard file. //True Copy// By order Sr.Pvt.secretary ITAT, Patna Date Initial 1. Draft dictated on 16.01.2025 Sr.PS 2. Draft placed before author 16.01.2025 Sr.PS 3. Draft proposed & placed before the JM second member 4. Draft discussed/approved by Second JM Member.
5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. File sent to the Bench Clerk Sr.PS 8. Date on which file goes to the OS 9. Date on which file goes to the SPS 10. Date of dispatch of Order.
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